Compromise looming on bill that pits electric co-ops vs cities

PIERRE — A compromise is in the works over SB66, a bill that would bar municipal electric utilities from expanding.

The bill pits cities with municipal utilities against rural electric cooperatives. Growing cities want to expand their coverage area while cooperatives don’t want their service areas to shrink.

SB66 was scheduled for testimony on Jan. 25 in the Senate Local Government Committee. The bill’s sponsor, Sen. Brock Greenfield, R-Clark, said the two sides in the debate sought to “seek a ceasefire.”

“I am completely happy with that development,” Greenfield said. “Sometimes legislative answers come without legislation.”

At least one legislative leader didn’t share Greenfield’s optimism about the bill. At the weekly news conference for legislative leaders, Senate Majority Leader Kris Langer, R-Dell Rapids, said the Legislature may still have to deal with SB66.

“We may be seeing that (bill) back again,” Langer said.

Greenfield asked the committee to hear testimony from people who had traveled to Pierre to testify about the bill and then defer further testimony and action to a later date if it is needed.

The only one to testify about the bill was Flandreau attorney Bob Pesall who spoke in opposition. While Pesall is an alderman in Flandreau, he said he was speaking as an attorney who has handled litigation involving utility companies.

Pesall said one of the arguments he has heard from proponents of the bill is that it is unfair for municipalities to take territory away from rural electric cooperatives. Pesall said he just handled three cases that concerned REAs taking land away from farmers through the use of eminent domain.

He said the rural electric cooperatives’ complaint about losing their territory “rings hollow.”

Pesall said another concern was that a small but growing community like Flandreau has the prospect of a new development on the edge of town being served by a rural electric cooperative. If an alderman lives in that development, he would find himself setting the electric rate for the rest of the community while not paying that rate himself.

“That seems, to my mind, to be a significant problem that needs to be addressed,” Pesall said.

Committee chairman Phil Jensen, R-Rapid City, said the committee would defer action on the bill until a later date.